Case Summaries

(draft of decedent's will sought to be admitted to probate by plaintiff, decedent's niece, who was also seeking to invalidate decedent's will; decedent did not see draft before death and trial court refused to admit will to probate and appellate court affirmed; appellate court also affirmed award of attorney fees to plaintiff). 

(estate could not deduct from gross value of estate the amount of capital gain tax decedent owed at time of death to state of California because it was not ascertainable with reasonable certainty as of the date of the decedent's death and decedent had already entered into a settlement with the state as to the amount of capital gain tax liability). 

(court reverses plaintiff's conviction of misapplication of fiduciary property (family assets contained in trust that passed to children upon death of parents); evidence insufficient to show that misapplied assets were actually owned by plaintiff or held for her benefit; judgment of acquittal entered). 

(estate not entitled to I.R.C. Sec. 2053 deduction for interest on loan taken out to pay federal and estate taxes; estate failed to prove necessity of loan and had enough liquid assets to pay the taxes). 

(KS estate tax applies to estates of decedent's dying during 2007 through 2009, but "pick-up" tax (amount equal to the federal credit for state death taxes) continues to apply to estates through 2016). 

(petitioner filed motion seeking determination she was common law wife of decedent and, therefore, entitled to estate tax refund due to marital deduction; motion denied because claim not filed in good faith and fraud and negligence penalties imposed; estate entitled to some administrative expenses). 

(plaintiff, estate executor, filed claim for refund of estate tax and IRS moved for summary judgment; under I.R.C. Sec. 6511(b)(2)(A), amount of refund limited to portion of tax paid within look-back period immediately preceding filing of claim (3 years plus the period of time for filing return); executor got extension for filing return and then got second extension; court held that IRS had no authority to grant second six-month extension; look-back period did not cover period during which payment made so executor not able to file refund claim; equitable estoppel not available to extend timeframe for extending time to file refund claim; IRS motion granted). 

(estate's valuation involving built-in, long-term capital gains discount for estate's interest in corporation sustained; court determined discount supported by evidence and calculation of IRS expert unconvincing). 

(married couple executed mutual wills that gave entire estate to survivor and then on survivor's death, one-half to the husband's children and one-half to the wife's children; wills also stated to be irrevocable on death of first of them to die; husband died and wife remarried and executed new will leaving her property to new husband if he survived and to her children and his children equally if she died first; wife sold first marital home after first husband's death (which they had owned in joint tenancy) and put sale proceeds in three separate CDs held in joint tenancy with her second husband; children of first husband sued to impose constructive trust on property; trial court ruled for wife and appellate court determined that because will did not restrict surviving spouse's use of property received from deceased first husband, children had no interest in spouse's property until she died; but, creation of jointly held CDs breached contract by removing them from her estate; case remanded so court could order wife to eliminate second husband's interest in CDs and enjoin wife from doing anything inconsistent with children's interest under contractual will (excluding expenses for her support)). 

(husband deeded farmland to wife and did not retain any reserved rights to the property; husband's motives irrelevant; divorce case involving division of marital property and spousal support). 

(under Illinois law, two estate beneficiaries held liable as transferees for the estate's tax deficiency to the extent of their bequests, which include payments to their attorney paid to enforce claims against the estate; court lacked jurisdiction to assess additions for failure to pay tax because the IRS failed to give notice). 

(will case involving allegations of undue influence; none found). 

(federal government lacks a rational basis for denying federal benefits to homosexual couples and, as such, Section 3 of the Defense of Marriage Act violates the due process clause of the Fifth Amendment; homosexual couples should be allowed to file joint income tax returns; court rules that Congress has no rational interest in promoting morality and conserving limited resources; court rules that, for purposes of federal tax benefits, federal government bound by state law - as such, opinion lays groundwork for basis of claim that recently enacted health care mandate is unconstitutional). 

(would exempt from tax first $3.5 million of value in decedent's estate, establish a progressive rate structure - 45% for taxable values between $3.5 million and $10 million, 50% for taxable values from $10 million to $50 million, 55% for taxable amounts from $50 million to $500 million and 65% for taxable amounts above $500 million; imposes mandatory 10-year minimum term for grantor-retained annuity trusts and restricts planning opportunities that utilize valuation discounts by changing the rules applicable to such discounts; increases agricultural land value reduction under I.R.C. Sec. 2032A to $3 million even for those agricultural estates where the decedent had bolstered wealth during life via receipt of taxpayer-funded farm subsidies; increases maximum exclusion for estate tax purposes for donated conservation easements to $2 million and increases base percentage to 60%; if enacted into law, only Japan would have a higher estate tax rate at the top end; bill sponsors are same Senators that earlier in June reportedly told the Senate Majority Leader that they would block any effort to bring a stand-alone estate tax measure to the floor; most insiders believe that the bill has virtually no chance of becoming law). 

(full amount of decedent's stock held only in decedent's name (decedent is a non-U.S. resident) included in gross estate as decedent's separate property; no late filing penalty assessed). 

(after their marriage, wife executed quit-claim deeds on three parcels of land that husband owned; husband then conveyed the parcels to his children from a prior marriage before his death; after husband's death, surviving spouse took elective share of decedent's augmented estate and court determined that genuine issue of material fact existed as to whether the parcels should be included in decedent's augmented estate for purposes of calculating surviving spouse's elective share because facts existed that raised a question as to whether decedent retained possession and enjoyment of, and income from, the parcels after the transfer - decedent continued to use the parcels for recreational purposes and held himself out as the owner of the parcels; trial court's judgment dismissing surviving spouse's claim reversed). 

(group of companies not includible in decedent's estate; decedent did not retain ownership interest in companies at time of death, did not bear financial burdens of ownership and had no intent to own any interest in the companies).

(reinstates state estate tax effective for deaths after April 30, 2010; includes provision which picks up I.R.C. Sec. 2102 which grants a credit for state estate tax paid by a non-citizen estate with situs in Hawaii).

(IN Dept. of Rev. properly classified trust beneficiary as Class C transferee under Ind. Code Sec. 6-4.1-1-3 for inheritance tax purposes; beneficiary (who was the biological grandchild of the decedent and also a trust beneficiary) was given up for adoption before becoming emancipated during lifetime of biological grandfather). 

(I.R.C. Sec. 2703 applies to gifted shares of FLP to donors' children such that FLP's transfer restrictions were ignored for valuation purposes; court also upheld Tax Court's determination that lack-of-marketability discount and minority interest discount were as determined by IRS rather than in the amount the petitioners' claimed). 

(decedent lacked testamentary capacity when codicil to will signed; decedent didn't sign on codicil's signature line and trial court properly viewed that act as an indication of decedent's state of mind; codicil not read to decedent and evidence lacking that decedent had capacity to comprehend nature, extent and state of affairs of her property). 

(while estate not required by statute to file an appraisal with estate's tax return with respect to farmland of decedent, value of farm for inheritance tax purposes if farm's fair market value rather than life estate value; decedent died holding a retained life estate in the property and transferred full value of farm to children at death). 

(premarital agreement valid and enforceable and resulted in each spouse waiving any interest in property owned by the other spouse on the date of the marriage, but did not defeat surviving spouse's claim to property acquired after date of marriage). 

(decedent not delusional when he amended his will by striking out names of in-laws from certain bequests and writing "void," "bastard" and "get nothing" on the will; court determined that decedent knew the parties listed in the will and was clearly determined to disinherit them; plaintiffs failed to establish that decedent lacked testamentary capacity).